TOKYO (Reuters) – Asian stocks steadied and US Treasury bond prices fell slightly on Thursday as the risk aversion triggered by the latest flare up of tensions between the United States and North Korea began to settle.

The flight-to-safety into US Treasuries also abated overnight. The 10-year Treasury note yield initially fell to a six-week low of 2.212 percent as bond prices rose, but pulled back to 2.251 percent.

“US equities managed to cut its losses towards yesterday’s close and while the VIX (volatility index) did pop higher, it still remains at an overall low level. Furthermore, the benchmark Treasury yield also climbed away from lows,” said Junichi Ishikawa, senior forex strategist at IG Securities in Tokyo.

“These developments suggest that risk aversion caused by geopolitical tensions in North Asia are temporary in nature, as long as it does not involve military conflict.”

Bids into the Japanese yen and Swiss franc, currencies that find demand in times of geopolitical anxiety, also tapered. The dollar was steady at 110.030 yen after going as low as 109.560 overnight, its weakest in eight weeks.

The Swiss currency was little changed against the dollar at 0.9637 franc after surging more than 1 percent the previous day. The euro was flat at $1.1759 while the dollar index against a basket of major currencies stood steady at 93.534 after dipping 0.1 percent the previous day.

Currency markets focused on the US producer price index data due later in the session. Investors will study the numbers to get a feel for the US inflation trend and any impact they data could have on the Federal Reserve’s monetary policy.The New Zealand dollar was 0.2 percent higher at $0.7354. The kiwi bounced from near one-month low of $0.7309 struck overnight as the Reserve Bank of New Zealand took a less dovish tone than some had feared.

The RBNZ held rates at a record low of 1.75 percent on Thursday and reiterated that policy would stay loose for a considerable time to come. In commodities, crude oil stretched gains after rising overnight on data pointing to declining US inventories.

Brent crude added 0.15 percent to $52.78 a barrel, inching towards a two-month peak of $52.93 set at the start of the month. Gold prices were nudged away from recent highs as broader risk aversion receded somewhat. Spot gold was 0.1 percent lower at $1,275.56 an ounce after having spiked the previous day to a near two-month peak of $1,278.66.